TESCO’S turnaround has gathered momentum as cheaper prices helped it win back customers and stem the pace of falling sales.

Tesco's turnaround has gathered momentum as cheaper prices helped it win back customers

The UK’s biggest supermarket halved the decline in its overall takings to 0.8 per cent in the 12 weeks to February 28 compared with a 1.6 per cent drop the previous month, according to analyst Kantar Worldpanel.

Separate data from information group Nielsen showed Tesco’s year-on-year sales were down by 0.5 per cent, its best performance since November 2013.

The figures will provide a boost to Tesco’s chief executive Dave Lewis, whose plan to revive its fortunes launched in the autumn of 2014 has involved price cuts, improving customer service, store closures and asset sales.

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Nielsen’s head of retail and business insight Mike Watkins said: “Tesco has been improving the basics, including its pricing. This has encouraged more visits and attracted back shoppers who’d previously defected.”

Tesco has been improving the basics, including its pricing

Mike Watkins, Nielsen

Tesco shares closed up 3¼p to 195¼p. Sainsbury’s was the only one of Britain’s big four supermarkets to grow overall sales, up 0.5 per cent, as German rivals Lidl and Aldi won market share to hold a combined 10 per cent.

The Co-op’s convenience store revamps and £200million investment in cutting prices across fresh food and vegetables, meat and poultry paid off as it increased sales by 1.9 per cent for an improved six per cent share of the market.

Aldi, whose sales jumped 15.1 per cent, has ramped up competition by extending the range of products available on its UK website.

After launching an online service in January – selling wines by the case, which has attracted about a million users a week – it has added its non-food “Special buys” to its website, with products including a Dyson handheld vacuum cleaner, the Ambiano nutrient blender and Gardenline petrol lawnmower.

Aldi’s joint managing director of buying Jonathan Neale said: “Many orders are coming from areas of Britain that don’t currently have many Aldi stores. “There is also no let-up in our physical store-opening programme.

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Aldi's sales jumped 15.1 per cent

“We have pledged to open more than 80 new supermarkets during 2016, with four openings already since the turn of the year.”

Aldi operates over 630 stores in the UK and plans to reach 1,000 by 2022.